The EB-5 employment-creation immigrant investor visa category continues to transcend its chutes-and-ladders early history. This 24-year-old program -- like many young adults of the same era -- seems at last to be maturing in healthy ways. Foreign investors have become more savvy. Regulators are more attuned to the need for greater investor protection, as well as clear, consistently enforced rules and predictable adjudicative outcomes (including swift justice for law violators). Seasoned dealmakers and developers, accustomed to raising substantial project capital from private equity markets, are now entering the field and bringing with them a set of industry practices that include robust law compliance as an inherent element of the fundraising business model. Yet one practice lingers. Immigration lawyers continue to wear too many hats. The Bible and law school teach that serving two (or more) masters is a recipe for trouble. So why then do so many reputable immigration lawyers think they can simultaneously represent the investor, the regional center and the project developers all in the same EB-5 transaction (while possibly also receiving finder’s or consulting fees on the side for procuring investors)? The answers are only partly governmental. U.S. Citizenship and Immigration Services (USCIS) and the State Department perpetuate the practice by allowing only one lawyer to submit a Form G-28 (notice of entry of appearance of attorney) in any given EB-5 benefits request, whether that be the request for approval of a regional center (Form I-924), the request for amendment of a regional center designation (Form I-924A), the EB-5 investor’s petition seeking classification as a conditional permanent resident (Form I-526), the application to register permanent residence or adjust status to conditional permanent resident (Form I-485), the immigrant visa application (Form DS-230), or the investor’s petition to remove conditions on residence (Form I-829). This governmental practice is unhealthy and unnatural. Most federal agencies outside of the immigration world recognize that parties with distinct legal interests to protect deserve to be heard and represented by the respective legal counsel of their choice. The Securities and Exchange Commission, for example, would never mandate or likely countenance that an investor’s counsel represent the interests of an issuer of securities, or vice-versa. Indeed, the adversarial system of justice is founded on the principle that the truth will out and justice will best prevail when conflicts of interest are minimized and each party to a controversy exercises the right to present evidence and legal argument in support of a particular position asserted before a neutral fact-finder/judge determining the truth and applying the law. Not so, the immigration bureaucracy. As I’ve blogged before, the government needs to stop forcing members of the bar and the several “publics” they serve to rely on only one lawyer to carry the legal water in a single immigration case where several distinct interests hang in the balance. But archaic immigration rules don’t really explain why EB-5 lawyers practicing immigration law too often tend to represent multiple parties. Immigration attorneys can readily serve distinct parties in an EB-5 case quite well by developing lawful work-arounds through multi-counsel collaboration agreements. Thus, the immigration attorney representing the project or the regional center, with client consent, can provide to investor’s counsel submitting the Form I-526 or Form I-829 all of the deal- or project-related documents and data needed to establish eligibility for the particular immigration benefit sought. Moreover, investor’s counsel, likewise with client consent, can and usually does undertake to provide the immigration lawyer representing the project or the regional center with timely notice and copies of all petition filings and any USCIS request for additional evidence, notice of intention to revoke petition approval or final decisions in a particular EB-5 investor’s petition. Similarly, immigration deal counsel or regional center counsel can and should provide the immigrant investor’s counsel with any USCIS actions or correspondence involving regional-center designation or amendment. So why then do immigration counsel wear so many EB-5 hats? Is it some misguided paternalism (the desire to make sure all parts of the process are controlled by a single, control-freak lawyer/strategist)? Is it a belief that the EB-5 project and its attendant investors are best served by the perceived efficiency and cost efficacy of using only one immigration lawyer or firm? Or is it merely bottomed on a rapacious desire to squeeze out the largest dollar value of legal fees from each and every EB-5 deal? I disclaim any clairvoyant ability to read the hearts and minds of my colleagues and thereby discern their underlying motivation for embracing joint client representation. Instead, my purpose in posting is merely to suggest that multi-party immigration representation in EB-5 cases is foolhardy and dangerous. If a deal fails, if EB-5 benefits are not achieved, or if one or more EB-5 investors fail(s) to receive green cards because too few jobs are created, then -- as sure as the night follows the day -- disappointed and disgruntled parties will engage successor counsel to point the finger of blame at whomsoever has pockets that seem deep enough to pay amends and thereby effectuate some form of retributive economic justice. (For more on this topic, check out an article co-authored by securities lawyers, Gregory L. White and Mark Katzoff, and me, "Hot Topics in EB-5 Financings," published in Forming and Operating an EB-5 Regional Center: A Guide for Developers and Business Innovators (ILW, 2014; Eds., L. Batya Schwartz Ehrens and Angelo A. Paparelli). Even if the multiple-fingers-in-multiple-pies immigration lawyer somehow prevails after all the finger-pointing exercises have been resolved, the process of deposition, discovery, settlement or trial will be enervating. So, my esteemed and beloved colleagues, it is folly to think that your artfully crafted disclosures and mutual consents to joint representation will withstand close scrutiny and protect you. Instead, just say no! Don’t ever agree to represent more than a single party (or perhaps at most a class of similarly situated investors) in any multi-party EB-5 transaction, whether it be a pooled investment involving direct job creation, or a syndicated investment made through a regional center. In my own case, the need for blissful sleep (and retention of my bar license) compel me to choose sides. I shall only represent the project or the regional center in any syndicated investment (prospective client referrals without referral fees paid are gladly accepted) and I’ll look to my many talented sisters and brothers at the bar to represent the interests of the investor(s). We can do this together while practicing separately -- that is, by each of us undertaking to represent only one party in any pooled EB-5 investment.

Angelo Paparelli, ABIL Immediate Past PresidentNation of ImmigratorsWith one week to go before the election, the final days have been marked by heated arguments over the proper role of government. In the prime battleground state of Ohio, the Presidential candidates have crisscrossed virtually every county, arguing over whether and when government should intervene to save or create jobs. Political comic, Jon Stewart, recently offered his usual sarcasm-saturated take on the topic, pointing out that -- whether the choice is made by government or the private sector -- consistently investing in winners while passing on likely losers is hard.

The same debate is playing out in microcosm on both coasts. In Washington and Laguna Niguel, officials of U.S. Citizenship and Immigration Services (USCIS) at the agency's DC headquarters and its California Service Center struggle and temporize over the selection of victorious and vanquished EB-5 Regional Centers. The EB-5 "employment-creation" immigrant visa category -- despite its 22-year, topsy-turvy history -- is finally beginning to capture the attention of U.S. dealmakers who seek project-financing alternatives to the nation's banks, which remain skittish about approving loans. Wealthy foreigners, however, still see America as attractive. The lure of green cards has produced a bumper crop of non-citizens willing to invest here, especially in Regional Centers, which are allowed by Congress to count both direct and indirect job-creation. So, in this land of caveat emptor and moral hazard, where the EB-5 regulations require that funds be "at risk," and Congress allows USCIS to approve Regional Center designations based merely on "general predictions . . . concerning . . . the jobs that will be created directly or indirectly as a result of . . . [EB-5] capital investments," why is USCIS falling down on the job? Why is the agency requiring reams of detail, elaborate econometric reports, and extensive financial plans and projections, yet is still not quickly approving applications for new or amended regional center designations? Why too is USCIS seemingly usurping the investor-protection role of the Securities and Exchange Commission rather than merely up-or-down adjudicating requests for immigration benefits in prompt fashion as Congress intended? I raised these questions in a colloquy with senior USCIS officials at a recent EB-5 stakeholders engagement, suggesting that the more evidence the agency demands, the more likely that foreign investors will infer that approved regional centers are government-vetted, -approved and -endorsed. Wouldn't it be better, I asked, that USCIS disabuse investors of any such inferences by following Congress's design? The EB-5 is a two-stage process involving classification of investors first for conditional green cards, and then 24 months later, taking another look when a petition to remove conditions on permanent residence is filed. Thus, if the jobs are not created or the investment is not sustained at the two-year check-in, then why not merely deny the petition to remove conditions? Here is the essence of USCIS's response -- "Open Questions from Room, Q2" (which, to me, is unsatisfying):

Conditional green cards confer precious rights;

USCIS has a duty to find by a preponderance of the evidence that a reasonable basis has been shown allowing the agency to infer that ten jobs per investor will likely be created;

USCIS has a duty to protect American job seekers and foreign investors from sketchy investment deals;

Denying petitions to remove conditions on residence would disrupt the lives of investors and create adverse financial consequences for many parties;

The agency therefore must ask for all the evidence it needs and take sufficient time to reach the conclusion that however many jobs a regional center predicts will be created will in fact result.

In a perfect world, this explanation might be plausible; but in the real world of business, deals can't wait months and months to determine if EB-5 investor financing will be permitted. Congress declared that regional centers merely submit "general predictions" that the required "jobs . . . will be created directly or indirectly as a result of . . . [EB-5] capital investments . . ." I offered USCIS a compromise solution: If a regional center predicts that 300 jobs will result from an aggregation of EB-5 investors' funds, but USCIS believes the evidence only establishes 250 reasonably likely jobs, why not approve the regional center designation and only allow investments capped at the amount needed to support this lesser number of jobs? The reflexive USCIS initial response was that such a finding might be interpreted as an endorsement by the government that the creation of 250 jobs is assured. Fortunately, however, the USCIS official leading the stakeholder engagement agreed to give further thought to the suggested compromise. If USCIS adopts the suggested practice of capping the amount of permitted investments by issuing a decision that permits but does not require a prescribed number of reasonably foreseeable jobs to be created, then a virtuous cycle ensues:

Regional centers and prospective EB-5 investors would be given the freedom to exercise their respective business judgment and independently decide whether or not the deal still makes sense;

If the scaled-back deal seems sound and investors still invest, they place their funds "at risk," as Congress intended;

Each investor, rather than the government, picks the hoped-for winner, as the god of Capitalism intended;

The rule of law would be honored by USCIS more in the observance than the breach, and

Immigration stakeholders would be one step further removed from living in a bureaucratically contrived Nanny State.

The EB-5 immigrant investor green card program resembles a multi-country version of Chutes and Ladders, the "game of rewards and consequences". In the EB-5 edition, the ladder represents progress toward a green card and the chute is an ICE-tunneled luge ride ending in immigration court at a removal hearing. This comparison only begins to approach the bewildering array of laws, regulations, holographic policy interpretations and artificial, bureaucratically-contrived traps for the unwary that lead up -- in two stages -- to the grant or denial to foreign investors of U.S. lawful permanent resident status. Recently, however, the agency administering the EB-5 program, U.S. Citizenship and Immigration Services (USCIS), has made some encouraging moves. In a message from its Director, Alejandro Mayorkas, the agency announced a variety of program changes. They include the formation of the Office of Immigrant Investor Programs, to be led an individual with business experience, though not necessarily a lawyer, the creation of a regional center Review Board, the employment of eight economists, and the hiring of attorneys with transactional experience. Some of these green-shoots changes -- though heartening -- smack of a "been there, done that" moment. Veterans of the EB-5 program will recall the 2005 "Establishment of an Investor and Regional Center Unit," which placed control of the program within USCIS Headquarters, and the termination of the Unit by memorandum in 2009. The decision to shut down what had evolved into a useful, facilitative practice of Headquarters engagement with EB-5 stakeholders, also included the unhelpful and ill-advised transfer of authority in EB-5 matters to the USCIS's California Service Center, and the decision to allow agency communication with only one lawyer in each investor's case, even though every EB-5 matter before USCIS typically includes multiple parties with varying legal interests, each represented by separate legal counsel. As I noted in my October 22, 2012 New York Law Journal article (coauthored with Ted Chiappari), "Dollars and Jobs for EB-5 Green Cards: A Challenging Route to U.S. Residency," this “Back to the Future” moment by itself is not enough:

The sad truth is that investors pursuing an EB-5 green card put their lives and their wealth at risk. In doing so, they may well face the predicament of Jack Benny, the American comedian known for his tightwad ways. When confronted by a mugger who screamed: “Don't make a move, this is a stickup. . . . Your money or your life,” Benny paused. The mugger insisted: “Look, bud! I said your money or your life!” Exasperated, Benny responded: “I'm thinking it over!” Such, sadly, is too often the unpalatable choice faced by incautious investors who leap without first looking carefully into the still perilous, but possibly improving, EB-5 immigrant visa program.